Ipsos Corporate Reputation

What Keeps Communicators Awake at Night?

Reputation Council members across the world face a range of business challenges – but what are the biggest issues that keep them awake at night?

24/7 and
fragmented media environment

"You have not only fragmentation but distrust in the media as well, which is making it increasingly difficult to engage and land messages."
"We used to control the information, these days, the information is coming from everywhere. So we play the role of conductor, catalyst."
"The demarcation line between capital markets and the rest of the world is getting more and more porous. Messages for the general public are becoming just as relevant for capital markets, and vice versa."
"We need to deal with a much more informed, empowered and vocal consumer."

Aligning internal teams

"We are a new organisation working with technology, so there aren’t regulations in place around what we do. There is an advocacy role we need to take… Bring the external voice to every business decision that is made and that is the increasing role of corporate communicators."
"Making it understood in-house that corporate and business are now one and the same, that there is no more dichotomy between corporate communications and actual user experience."
"Reputation issues are being included more and more in the due diligence processes for big government tenders. This not only affects us, but also the partners we bring into large projects."
"If you work for a business where the CEO fundamentally doesn’t get or give time to reputation management, it makes the job really hard, whereas if you have that sponsorship from the top, you can achieve a lot more."
"It’s a reputation economy... Marketers don’t get reputation. I think it takes a crisis for people to realise the importance in reputation management."

Employee Engagement

"Engaging and activating employees, because not everyone trusts a CEO, but they trust people like themselves."
"Each individual has become a medium in their own right and a communicator, we need to work particularly hard on associates in the company who are its first spokespersons, first ambassadors, and who, what’s more, can potentially be very powerful."

Fake news, misinformation,
and declining trust in experts

"The main problem is the issue of credibility – how the messages that you are delivering are credible for the different stakeholders."
"Because people don’t really care about what you are trying to communicate with them, they care more about what you are doing and what value you can bring."

Sustainability and purpose

"Society has an expectation that corporates deliver for those communities where we live and work… Local relationships are more important."
"The digital revolution brings many differences of behaviours, very different desires, ways of working, ways to consume information. And this generation has a very clear vision of the absolute need to transform society in terms of sustainability."

Lack of public trust in business

"If I talk to my counterparts in the FTSE 100, they see this anti-capitalist sentiment and there is an anti-business sentiment and there’s a lack of trust that the corporate sector will do the right thing and there’s a very unsophisticated view that it is all about shareholders and we don’t worry about other stakeholders."
"We’re facing the defiance that companies, and particularly large multinationals, can generate among the general public, but through contamination coming from the media, political decision-makers."

Political polarisation

"As a global company, what are the right issues that employees, customers and investors want to see us involved in? The company looks to the communications function to advise on where to take a stand and what are the costs/benefits."
"The turbulent political environment and lack of harmony in society. We’re trying to find our place as a company to remedy that."
"Deteriorating levels of trust in government and a deterioration in the functionality, effectiveness and stability of government. There is uncertainty in the policy environment."

Methodology: 154 interviews conducted with Reputation Council members between 25th June and 12th November 2018.

Read more from the Reputation Council...

Read more from the Ipsos Corporate Reputation Team...

It’s the environment, stupid!


Whilst it doesn’t roll off the tongue with as much zest, James Carville’s ‘the economy, stupid’ slogan is aptly modified for Larry Fink’s announcement earlier this year that BlackRock would base future investments with environmental sustainability as a central goal… ‘It’s the environment, stupid!’. If anyone could ‘wake up’ the market to the tipping point which has now been reached around the environment, it is the Chief Executive of the world’s largest asset management firm. “Awareness is rapidly changing” wrote Mr Fink in the company’s annual letter, “and I believe we are on the edge of a fundamental reshaping of finance”. This has been compounded more recently, with the announcement that the UK’s biggest pension fund, the government-backed National Employment Savings Trust (Nest), will begin divesting from fossil fuels, and BlackRock “launching a selection of ESG multi-asset ETFs, to provide investors with a cost-efficient, transparent and sustainable way to invest”.

Data from Ipsos’s 2020 Sustainable Business Monitor survey amongst the British public echoes these sentiments. With a majority of the public now feeling we are dealing with a climate crisis, it appears that cash may no longer be king in investments. Only 21% now claim to care more about financial returns on investments than on whether the financial provider is ethical in how it invests money. This is compared to 28% of the public who prioritise ethics over financial returns and 26% who feel they should be given equal footing. Even allowing for the possibility that consumers may not be quite so ethical when faced with this trade-off in reality, it is clear that there has been a change in the drivers of investment decision making.

Returns on investment or ethical considerations?
Views on Climate Change

The growing imperative for investors to prioritise companies with a good sustainability track record is brought into sharper focus when looking more closely at the attitudes of millennials. Findings from the Ipsos Sustainable Business Monitor show that 54% of 18-34 year olds would be concerned about investments in Oil and Gas, compared to 47% for the UK public overall. This isn’t limited to the UK either; sustainable investing interest among US millennial investors jumped from 84% in 2015 to 95% in 2019, according to Morgan Stanley’s Institute for Sustainable Investing.

Which sectors concern the public regarding investments?

So, what does this all mean? Unsurprisingly, that Fink is right.

Over one third of those asked said that investment in projects or companies that have a detrimental environmental impact would lead them to ‘switch from’, ‘stop using’, or ‘boycott’ a financial organisation. Indeed, sustainable investing is ranked alongside executive remuneration – an issue that has a long track record of being a strong driver of negative opinion for the finance sector.

Switching / Boycotting financial organisations

This sentiment is further reflected at a global level when looking at Ipsos data from the recent Earth Day 2020 report, highlighting that even when set against the crisis situation that COVID-19 has presented, concerns around the environment remain steadfast. Over 7 in 10 people around the world agree that climate change is as serious as the pandemic, whilst 65% agree that in the economic recovery from COVID-19, it’s important that government actions prioritise climate change.

Seriousness of climate change in comparison to COVID-19
Support for a 'green' economic recorvery from COVID-19

Recognising the growing commercial opportunity facing the sector, and the long-term risk of investing in environmentally unfriendly industries, Fink notes that “as a fiduciary, our responsibility is to help clients navigate this transition [the reallocation of capital]. Our investment conviction is that sustainability and climate-integrated portfolios can provide better risk-adjusted returns to investors”.

But where does this leave industries which have been traditionally harmful to the environment, such as the oil and gas industry, for a long time the bedrock of investment portfolios and still an essential service despite growing environmental concern?

In light of BlackRock’s position, The Economist wrote: “[t]o cynics, all the climate-friendly noises amount to little in practice, since few people are ready to make carbon-cutting sacrifices that would force oil firms’ hands. But noises are sometimes followed by action. Should they be this time, the 2020s may be do-or-die for the oil industry”.

It isn’t a case of ‘adapt tomorrow or die’ for fossil fuel companies however, and Fink makes this clear, forecasting “the energy transition will still take decades”. Citing fairness and justice, “we cannot leave behind parts of society, or entire countries in developing markets, as we pursue the path to a low-carbon world”. The demand for energy will continue whilst technology works to bring cost-effective replacements to conventional fuel sources, but it is incumbent on the sector to aggressively pursue cleaner energy; not only from an ethical perspective, but also in order to remain an attractive investment. The same is also true for a number of other sectors which have for a long time been harmful to the environment, and must adapt with the new way of sustainable investing.

Companies from within the fossil fuel and investment sectors which are leading the transition to a more sustainable future are on the right path, reinforced by public support. This should not be derailed. Communicators in these sectors therefore have the opportunity to maintain messaging around this transition, but with fairness in mind, should also remain sensitive to the societies whose energy programs are not as developed as some of the leading world economies. The transition to sustainable investing will need a collective effort – innovation from industry, reallocation of risk, government support and sustained societal scrutiny, but in adopting Fink’s position, it should be worthwhile effort for investors, producers, and consumers, from both an environmental and a financial perspective.

Contact: Alex Russell - Email | LinkedIn

Reputation Council Quickfire Survey: Members’ Perspectives on ESG

Our Quickfire surveys provide us with fast views and responses on the world’s most pressing issues.